ESB Customer Relationship Management 1

Question 1

What is the primary goal of Customer Relationship Management (CRM) for a small business?

Accepted Answer

Building and maintaining profitable long-term customer relationships

Answer

CRM focuses on building long-term, profitable relationships with customers by understanding their needs and improving satisfaction.

Question 2

Which metric best measures how likely a customer is to recommend your business to others?

Accepted Answer

Net Promoter Score (NPS)

Answer

Net Promoter Score (NPS) asks customers how likely they are to recommend a business on a scale of 0–10, making it the standard loyalty and advocacy metric.

Question 3

A small business notices that 20% of its customers generate 80% of its revenue. This observation reflects which business principle?

Accepted Answer

The Pareto Principle (80/20 Rule)

Answer

The Pareto Principle states that roughly 80% of effects come from 20% of causes, commonly applied to show that a small segment of customers drives most revenue.

Question 4

What does 'customer lifetime value' (CLV) represent?

Accepted Answer

The total revenue a customer generates over the entire relationship with the business

Answer

CLV is the total net revenue a business can expect from a single customer account throughout the entire business relationship.

Question 5

Which of the following is a key advantage of using CRM software in a small business?

Accepted Answer

It centralizes customer data for better communication and follow-up

Answer

CRM software consolidates customer information in one place, enabling better tracking of interactions and more personalized follow-up.

ESB - Certified Entrepreneurship and Small Business Specialist Practice Test

ESB - Certified Entrepreneurship and Small Business Specialist Practice Test

ESB Customer Relationship Management 1